Income taxes paid are cash outflows net of refunds under the applicable disclosure population. They differ from tax expense and from the ending payable because payments can settle prior periods and expense can include deferred or noncash effects. Reconcile cash to treasury and jurisdiction records.
Apply the current jurisdiction threshold
ASC 740-10-50-23 requires annual disclosure of income taxes paid net of refunds by jurisdiction when the stated five-percent threshold is met under its transition terms.
If total net taxes paid are $160,000, the five-percent threshold is $8,000. Supplied federal payments of $130,000, state payments of $20,000, and foreign payments of $10,000 each exceed it. Do not treat the threshold as a recognition rule or net unrelated jurisdictions to hide a reportable amount. Preserve gross payments, refunds, tax year, payment date, jurisdiction, currency, and ledger tie. This page applies supplied population and scope facts; it does not determine a real filing obligation.
Put the concept to work
Analyze this concept
- Reconcile taxes paid to cash records and route jurisdictions meeting the current five-percent disclosure threshold without substituting expense or payable balances.
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